COBRA Subsidies Ending: Employer Obligations to Provide Final Notice

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In March 2021, the American Rescue Plan Act (“ARPA”) was enacted, creating a federal subsidy that fully covered COBRA premiums for qualified beneficiaries. These subsidies will end on September 30, 2021.

Employers are required to inform COBRA subsidy recipients that the subsidies are coming to an end. Employers must also provide such recipients information about health coverage options going forward.

Who does this apply to?

Generally, all employers with a workforce of 20 or more employees are subject to the notice requirement. Conversely, California domiciled employers with fewer than 20 employees are subject to Cal-COBRA, which is usually administered by a health insurance carrier who will be responsible for distributing such notices.

When and to whom do I distribute the notice?

The notice must be distributed within 15-45 days before the COBRA subsidies expire (September 30, 2021) or 15-45 days before an individual reaches the end of their maximum COBRA continuation coverage—whichever occurs earlier. Generally speaking, employers should send out the notice between August 16, 2021, and September 15, 2021.

As a best practice, employers should send out an expiration notice to all subsidy recipients.

What should my notice include?

Happily, the Department of Labor has drafted a “model notice” (see here)  that can be used to satisfy the notice requirement.

Should you wish to create your own notice, however, the notice should include the following information:

  • Date of the notice.
  • Identity of the qualified beneficiary(ies).
  • Name of the group health plan or insurance policy.
  • Reason the individual is receiving the notice: i) due to the end of their maximum period of continuation coverage, or ii) due to the end of the COBRA subsidy.
  • Date on which the individual’s maximum period of continuation coverage will end, or the date of the end of the COBRA subsidy.
  • Specify the full, unsubsidized premium amount owed should the individual choose to keep their COBRA coverage in effect.
  • Information about the HealthCare Marketplace.

What to do now?

Employers should coordinate with their COBRA administrators to ensure that subsidy recipients will timely receive the expiration notice. Employers who administer COBRA themselves must ensure that they timely provide this required notice.

For more information, please contact us at

This material is provided for informational purposes only. It is not intended to constitute legal advice, nor does it create a client-lawyer relationship between MNK Law and any recipient. Recipients should consult with counsel before taking any actions based on the information contained within this material.